April 1, 2003
The Honorable Philip M. Crane
Chairman
Subcommittee on Trade
Committee on Ways and Means
U.S. House of Representatives
Washington, DC 20515

Dear Chairman Crane:

On behalf of the US-ASEAN Business Council and its 150 member companies
doing business in the ASEAN countries, I am writing to express our
support for the extension of normal trade relations (NTR) to Laos. The
Council has been on record in support of NTR for Laos since the
negotiation of a bilateral trade agreement between the United States and
the Lao People's Democratic Republic in 1997. We agree with the
Committee Advisory's March 5 statement soliciting comments that
ratification of the agreement "will represent an important step toward
economic reform and openness, key U.S. priorities in Laos."

As we noted in our third annual submission of recommendations to the
Executive and Legislative Branches of the U.S. Government, the
importance of the ASEAN region to American political, economic and
security interests is increasing and there is a lot that needs to be
done to increase our engagement of ASEAN and its member nations. In our
most recent paper of February, 2003 we specifically listed the
establishment of Normal Trading Relations with Laos as an achievable
accomplishment for 2003.

Furthermore, the Administration itself is fully supportive of NTR for
Laos as the joint letter of February 24, 2003 from Secretary of State
Colin Powell and United States Trade Representative Robert Zoellick
attests. Granting NTR to Laos would also be a step forward to achieving
the laudable goals set out by President George Bush during the October
2002 APEC meeting in Los Cabos, Mexico. There President Bush in his
Enterprise for ASEAN Initiative pledged to work with countries like Laos
in their quest to meet the requirements for WTO accession.

Laos is one of the poorest countries in the world, but thanks to its
lack of normal trading relations with the US is subject to the highest
average tariffs. According to an analysis by Ed Gresser of Progressive
Policy Institute, Laos faces the highest average tariffs in the world
(45.3%), higher even than North Korea's (35%) and Yugoslavia's (27.7%).
Typical rates are 8-10%. Laos now exports garments, gems and jewelry,
agricultural products, hydro-electricity, timber, labor and narcotics
(illegally). As a matter of US national interest, if we would like Laos
to export less in the last three categories, we have to help them export
more in the first four. Extending NTR is key to that.

The Lao Government is taking steps toward free market reforms. Agreeing
to the bilateral trade agreement with the United States in 1997 is
certainly an important indication of a willingness to open the country
up to the outside world. We at the Council are fully aware that trade
agreements negotiated by the Executive Branch and approved, hopefully,
by the Congress are only the first stage of stronger and mutually
beneficial economic ties. It is imperative that the Government of Laos
provide American companies and their own state and private enterprises
with the legal framework and operational authority they need to pursue
successful trade and investments. Additionally, the Lao Government needs
to continue its commendable work on addressing POW/MIA issues and
stemming the flow of narcotics.

We commend you and the Committee for considering taking this long
overdue step to normalize economic relations between the United States
and Laos. We look forward to working with you to achieve this. Thank you
for your consideration.

Sincerely yours,



Ernest Z. Bower
President
US-ASEAN Business Council